MyStemKits STEM job of the week: Financial manager
Who handles your money, advises you on what to spend and when to spend it? Well for organizations that person would be their financial manager. This week we look at exactly what it is that financial managers do.
Financial managers are the individuals responsible for the financial maintenance of an organization. They are responsible for producing financial reports, investment activities, and strategies that reflect the long-term financial goals of their organization.
Financial managers also do tasks that are specific to their organization or industry. To provide the financial direction specifically needed for their organization a financial manager needs to be knowledgeable about the tax laws and regulations that affect that industry. Also, financial managers must have strong analytical skills to access their client’s needs and strong problem-solving skills to make financial improvements.
The life of a financial manager can very demanding and stressful, here are a few of their typical duties:
- Prepare financial statements, business activity reports, and forecasts
- Monitor financial details to ensure that legal requirements are met
- Supervise employees who do financial reporting and budgeting
- Review company financial reports and seek ways to reduce costs
- Analyze market trends to maximize profits and find expansion opportunities
- Help management make financial decisions
Based on an organization’s needs, there are financial managers for specific areas of business. Below are examples of these individuals and their primary functions.
- Chief financial officers (CFOs) – are responsible for maintaining the accuracy of a company’s or organization’s financial reports. They manage the department’s lower level financial managers and they oversee the company’s financial goals, objectives, and budgets.
- Controllers – manage the preparation of financial reports that summarize and predict an organization’s financial position. They also oversee the organization’s accounting, auditing, and budgeting departments.
- Treasurers and finance officers – direct their organization’s budgets to meet its financial goals. They oversee the investment of funds and carry out strategies to raise capital (such as issuing stocks or bonds) to support the firm’s expansion. They also develop financial plans for mergers (two companies joining together) and acquisitions (one company buying another).
- Credit managers – oversee their firm’s credit business. They set credit-rating criteria, determine credit ceilings, and monitor the collections of past-due accounts.
- Cash managers – monitor and control the flow of cash that comes in and goes out of the company to meet the company’s business and investment needs. For example, they must project cash flow (amounts coming in and going out) to determine whether the company will have a shortage or surplus of cash.
- Risk managers – control financial risk by using strategies to limit or offset the probability of a financial loss or a company’s exposure to financial uncertainty. Among the risks they try to limit are those that stem from currency or commodity price changes.
- Insurance managers – decide how best to limit a company’s losses by obtaining insurance against risks, such as the need to make disability payments for an employee who gets hurt on the job or the costs imposed by a lawsuit against the company.
All businesses are concerned about their financial performance, therefor financial managers can find employment in many industries. Ex (banking, insurance, and retail sectors)
Although the industry is growing, financial managers face a competitive job market. The Bureau of Labor Statistics estimates that the field will grow 7 percent by 2024. This means that at least 37,700 new jobs will emerge and the competition will become greater. The individuals with specialized backgrounds like accounting or finance may find it easier to find employment but the ones who can handle international finance and the complicated world of financial instruments and securities, will be the most sought after out of them all.